Thailand’s state planning agency, the National Economic and Social Development Board (NESDB), today said the country’s gross domestic product (GDP) contracted by 7.1 per cent in the first quarter of this year, putting Thai economy into a recession for the first time in a decade.

NESDB secretary-general Ampon Kittiampon said the 7.1-percent contraction when compared with the same period last year, further falling from 4.3 percent drop in the fourth quarter of last year, is the heaviest fall of the country’s economy since the financial crisis in 1997.

Ampon said the country’s economy during the first quarter has been strongly affected by the continuing global economic meltdown, resulting in a drop of 17.9 percent in Thai export volume from that of the same quarter last year and a drop of 19.3 percent in export value in US dollars from that of the same quarter last year.

During the quarter, he said, household consumption contracted for the first time in a decade at 2.6 percent from the same period last year while private investment shrank 17.7 percent.

The agency chief however said Thai economy is likely to hit the bottom in the first quarter and may be adjusting itself to recover in the second half of this year, with a support from economic stimulus programmes of the government.

Therefore, he said, the NESDB has predicted that Thailand’s GDP is likely to contract between 2.5-3.5 percent for the entire year.

In addition, the agency has also forecast that the country’s exports would contract 15 percent this year while the imports could shrink further to 19.6 percent, with a possible trade surplus of over US$8.3 billion, current account surplus of US$9.3 billion and inflation to either contract or rise by half a percent, he added.

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